Nurses are used by the clinic to provide clinic visits. Each visit brings in $2 in revenue for the clinic. The relationship between nursing units and clinic visits is as follows:

Quantity of Nurses Total Clinic Visits

1 5

2 9

3 12

4 14

5 15

The provider is assumed to maximize profits. Determine the provider’s equilibrium wage and how many nursing units it will hire. The provider is a monopsonist, which means it is the sole purchaser of labor in the market.

Ch-12

12.

Given the following MV information, what is the optimal allocation of care according to the Paretean criteria, when the marginal cost of care is constant at $100.